Raisin Capital completes new share purchase deal for SMEP Microfinance Bank

Hope International, a strategic investor focused on purpose-driven investments, has recently acquired a 51% controlling stake in SMEP Microfinance Bank (SMEB) in a groundbreaking deal aimed at expanding the bank's reach and impact in the region. The transaction, which was carefully structured to align with the Christian ethos of both the investor and the bank, is poised to position SMEB as one of the leading deposit-taking microfinance institutions in Kenya and potentially East Africa. CNBC Africa's Aby Agina sat down with Francis Nasyomba, CEO and Principal of Raisin Capital, the advisory firm that facilitated the deal, to delve into the key aspects of the transaction and its implications for both SMEB and Hope International. The acquisition of a majority stake by Hope International not only provides SMEB with the necessary capital to propel its growth strategies but also introduces a strategic partner that is aligned with the bank's values and vision. This strategic alignment was a crucial aspect of the transaction, as it involved ensuring that the new investor shared the same Christian ethos that has been integral to SMEB's operations. By securing a partner that resonates with its core principles, SMEB can now leverage this partnership to enhance its offerings, expand its customer base, and strengthen its market position. The deal, which saw Hope International acquiring a 51% stake in SMEB, effectively diluting the ownership of existing shareholders to 49%, is expected to drive significant enhancements in SMEB's operations and infrastructure. With a robust balance sheet and increased funding, SMEB is poised to ramp up its lending activities, improve its technological capabilities, enhance product design, and bolster its network. These strategic initiatives are set to make SMEB more competitive in the microfinance industry and propel its growth trajectory in the region. While the monetary value of the transaction remains confidential due to disclosure regulations, the focus remains on the transformative impact it will have on SMEB's operations and the broader implications for the microfinance sector in Kenya. Notably, the shift towards purpose-driven investments underscores a growing trend in the financial industry, where investors are not only seeking financial returns but also emphasizing social and environmental impact. Purpose-driven investments like the acquisition of SMEB by Hope International highlight a commitment to creating sustainable businesses that prioritize customer welfare, employee well-being, and community development. By aligning investment strategies with overarching goals of social responsibility and impact, financial investors are embracing a more holistic approach to wealth creation and business sustainability. The deal crafted by Raisin Capital exemplifies the pinnacle of purpose-driven investment, where the focus is not solely on financial gains but on fostering positive change and advancing ethical values within the business landscape. As SMEB embarks on this new chapter with Hope International as a key stakeholder, the stage is set for a transformative journey towards building a more inclusive, impactful, and purposeful microfinance institution that resonates with the values of its stakeholders and the communities it serves.